Pricing to market – an investigation into the use of comparable evidence in property valuation

Abstract

Purpose: The intent of this paper is to identify the role that comparable evidence plays in property valuation and how the availability and use of comparable evidence varies between different countries and jurisdictions across Europe. Design/methodology/approach: The paper is an overview of the role of comparable evidence, in all its forms, in property valuation. Through a survey of individuals and professional valuation associations, the relevant importance of different forms of market evidence was assessed and ranked according to the business transparency of the market in question. Findings: The findings of this study helped inform The European Group of Valuers' Associations (TEGOVA) when setting the European Valuation Standards (EVS). The definition of Comparable Evidence should not be so narrow as to only include transactional evidence. Practical implications: The role of the professional property valuer is to provide value estimates for a range of purposes but when that purpose is to assess Market Value, the importance of pricing to market cannot be over-stated. Originality/value: This provides guidance on how to identify and use comparable evidence to undertake valuations for Market Value.